One of the great interoperability experiments in financial history occurred in mid-to-late 1800s Europe, and was ruthlessly exploited by none other than the temporal arm of the Catholic Church: The Papal States. In the US we have “In God We Trust” on our currency, but 150 years ago, God proved to be pretty untrustworthy with currency. To set the stage, the year was 1865. America and China, both recently emerged from lengthy civil wars, are still putting themselves back together. The European powers are still the stars of the economic stage. France, Belgium, Italy, and Switzerland sign a treaty to standardize their metallic currencies, with a fixed weight and fineness of silver and gold per franc, lira, etc. The common silver/gold content would allow the four currencies to circulate within each others’ borders to make trade easier. France was the center of gravity for the arrangement, which came to be known informally as the Latin Monetary Union. Other states eventually joined in the standardization as well - including the recently diminished post-unification Papal States. Then comes the currency caper by Cardinal Antonelli, the treasurer of the Holy See. The abuse ran along two separate dimensions: issuance limits and debasement. Each nation had an issuance limit, roughly tied to their population size, to prevent race conditions amongst the nations to mint the dominant circulating coin. Cardinal Antonelli exceeded the minting cap for the sub-million-population Papal States quickly and repeatedly. The Papal States also quietly debased their coinage and sold it into the market (especially France). This was successful because no one was bothering to assay the coins of members. It worked for a few years until the French and Swiss banks wised up. By 1870, Papal funny money was no longer accepted at par and anyone who held it at the time of demonetization ate the losses. The monetary union limped along (it had other major problems) until WWI, when it was discontinued. This is exactly why it is vital to understand the exact backing of stablecoins. If the Church was willing to fraudulently issue undercollateralized stablecoins, you can’t assume a crypto issuer wouldn’t do the same!